Tag Archives | fear

This is a continuation of the Trading Words of Wisdom By Yoda, for Quote #5 click here.

“Fear is the path to the dark side…fear leads to anger…anger leads to hate…hate leads to suffering.” -The Phantom Menace

When young Anakin Skywalker is standing before the Jedi Council, we have no idea the of the dark, bitter creature he will become. Yoda does, though. Yoda senses something in Anakin that worries him: Anakin’s fear. Yoda’s early prediction came true as Anakin’s fears are realized and he becomes angry and hateful. In the end, though, we see that Anakin doesn’t have anger and hate to lift him anymore, he is just suffering.

As Traders, we can relate to Anakin’s fear of losses; we should always be aware of two dominating emotions: fear and greed.

Fear is a crucial response in humans to preserve both emotional and physical well-being. It works as a warning in our brain to show when something is dangerous or threatening. Most of us, however, fear uselessly and that fear holds us back. It’s natural for a trader’s fear to spike with the drop of a stock, or stomach clench when bad news comes from the market. Marie Curie, a physicist/chemist who was known for her pioneering research on radioactivity, adequately stated that “nothing in life is to be feared, it is only to be understood.” And explains, “Now is the time to understand more, so that we may fear less.” As traders, when we understand our fear and what causes it then we can either prevent it, prepare for it, or isolate it.

Greed can be just a devastating to traders. If you are too greedy then you will, as the old Wall Street saying goes, get slaughtered. None of us want to experience the humiliation of trying to squeeze every last tick out of winning position and getting blown out or whipsawed. For most of us, greed comes from an internal drive to get more and do better. Yet, success in the markets is based on a well-thought and calculated business plan, not those emotional impulses demanding more from yourself.

Take the time to develop a good trading plan that you trust enough that when these emotions rise, you are willing to stick to it. In the end, it feels a lot better to stand by your trading plan than to jump into destructive emotions like fear and greed. Eventually, fear and greed leave you, and your left to suffer the losses like the sad figure of Anakin Skywalker at the end of Return of The Jedi.

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We all know everything in California is known to cause cancer, right? How could you miss it when there are warning signs posted on your grocery bags, in your hotel room, a restaurant, and even as you enter the Disneyland Resort. If simply entering the state is known to ‘cause cancer and birth defects,’ then why do 38.8 million people live there?

And we all know trading forex is dangerous. The warning that a bunch of power hungry wall street suits are scrambling around just to steal your money. You might as well be gambling, right? Then why are millions of trading transactions taking place every day?

Trading Forex is about as dangerous as going to California for vacation. Sure, California has the potential to be harmful…if you go around licking signposts, eating wrappers, and sunbathing without sunscreen. Trading Forex might not be as relaxing as a nice trip to California, but it’s not a dangerous slot machine either. As long as you follow some common trading sense rules, you’ll avoid the substantial losses that instill hefty doses of fear in each of us.

Take time to learn how to trade safely, and you don’t need to fear the market. The Apiary Fund teaches and funds traders in the currency market, so you’re covered as you start the learning curve that comes with a new skill. Learn more at apiaryfund.com

Happy Trading!

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A 2014 study conducted by Babson College revealed how fear of failure stops some people from engaging in activities where failure is a possible outcome – including the activity of learning. The study concluded that the fear of failure negatively influences a person’s motivation to learn and their attitude toward learning.

This study has direct implications on the mission and purpose of the Apiary Fund. At its core, the Apiary Fund teaches a person how to manage an investment portfolio – an activity where risk of failure is very real. We accomplish the goal through a progression of classes, simulation, and the eventual management of a small portfolio in live market conditions.

At every step, Apiary works to mitigate the elements of risk and teach a person how to properly analyze and make decisions that include risk. We strive in every possible way to give a person the greatest chance of success in learning how to manage an investment portfolio.

The irony of this study is that when fear of failure prevents a person from engaging in an activity that will make them better, it almost assures their failure in that activity. And when that activity is learning how to manage our finances and investments, the cost of failure can be high! Imagine living your life and avoiding all investment decisions – it is likely to leave you broke for retirement. Imagine giving all those decisions to someone else – it leaves you vulnerable to fraud, mismanagement, and high costs.

We know that many of you join Apiary Fund for the opportunity of trading our money. It is a wonderful incentive – one I wish I had when I was first starting! However, what you really gain through your Apiary experience is a skill and an ability to make intelligent decisions that involve the risk. That is a skill and an ability that has far a greater reach and value in your life than any amount of money you could trade for Apiary Fund!

Disclaimer

Investing in securities, currencies, and/or contracts associated therewith carries inherent risks. No person, institution, or entity, including the Apiary Investment Fund, can guarantee a return on investment for such transactions. Neither the Apiary Investment Fund nor its representatives will recommend the purchase, sale, or transaction advice for a specific security.